Research from internet bank Egg has shown that the advantages of a discounted mortgage can evaporate as soon as 14 months after the discount period is over.
Staying on the original discount deal for five years could cost consumers £1,840 more than simply opting for a mortgage with a standard variable rate fixed one per cent above Bank of England base rate, Egg reveals.
"Discounted rate mortgages are popular with homeowners for good reason, as they help initially to reduce outgoings," noted Andy Deller, director of banking and insurance at Egg, adding: "However, for the typical borrower avoiding loans with a high ongoing standard rate is more important.
"Our research shows that on average once borrowers start paying this ongoing rate they have a mere 14 months to remortgage before all of the benefit of their initial discount is destroyed."To find out more about remortgaging, click here.
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